The concept of employee choice in the type of benefits received from employers is taking hold worldwide, particularly as it offers a chance for employers to cut costs without cutting benefits, according to benefits consulting firm Mercer L.L.C.

The company conducted a survey of more than 1,700 employers in 47 countries outside of the United States in May and June to find out what kinds of benefits companies offer and how they plan to change them.

Attitudes and strategies toward employee benefits varies widely across the globe and depends largely upon local health systems and taxation systems. But the survey found that interest in flexible benefits packages that provide employees with wider choice about the mix of benefits received is becoming more popular in many countries.

The survey found that the main reasons why companies offer benefits remains the need to be competitive in the market for labor and to help retain staff.

One-third of those surveyed said they are seeking ways to cut benefits costs because of the global economic downturn, and one-quarter of those surveyed already have done so. But only 7% see a need to make a significant change to the benefits offered to employees to try and cut costs.

Similarly, only 9% of those surveyed said they plan to increase employee contributions, while 4% said they plan to scale back benefits offered.

One of the key reasons why many companies said they do not feel they have to cut benefits to cut costs is because of the potential offered by flexible systems, according to Mercer.

“The pressure to reduce the cost of providing health benefits does not show any sign of abating. As the survey results show, offering employees more choice in selecting the benefits that best match their needs and lifestyles not only can contribute in attraction and retention efforts, but also can help reduce costs at the same time. As employees and employers accustom themselves to the concept of choice in benefits, we can expect to see more comprehensive flexible programs implemented in various countries,” stated the report.

The survey also found that few companies—2% of those surveyed—offer their benefits on a global basis. Nine percent of those surveyed offer benefits on a regional basis, while the majority offer them on a national basis.

But it also found that some 25% of those surveyed are considering the implementation of a global employee benefits strategy.